More and more vendors are rolling out technology that will allow consumers to use cell phones to do their banking. They're just waiting for customers to start using these technologies. While it will eventually happen, these companies should have some patience, because consumers are still wary about the perceived risks.
A study from Javelin Strategy & Research, a financial-services payment research company, reveals that customers are interested in the idea of mobile P2P banking, but are not yet confident that these technologies are safe to use. James Van Dyke, Javelin's president and founder, says that companies still need to make security a priority.
"A full third of our report is devoted to security simply because we find that industry companies so often get security issues wrong. It's so unbelievably misunderstood," Van Dyke said. "We'd like to see more authentication measures where people are asked to remember key phrases and things like that."
Risky Behavior, Not Technology
Still, Van Dyke said that security concerns were more a matter of perception than actual risk. "What's interesting is that we don't see significant security features going in, but we don't expect to see widespread actual security risks. We expect to see widespread security fears, yet we don't see [mobile P2P banking] as a particularly risky thing to do," he said. One reason the security risks will be lower than for desktop PCs is that there is a wide range of mobile platforms in use rather than one monolithic platform, he added.
He noted that dangers are more likely to arise from behavior by users -- particularly young people -- rather than security flaws. Young people "take undue risks with personal technology," he said. Some reasons for that, he surmised, are that they "typically don't have as many financial assets, and they tend to be haphazard [with their use of technology] in general. It's surprising how that stereotype really plays out in the data."
Technology To Bet On
Mobile P2P technology has been slow to catch on, particularly compared to overseas markets, but Javelin's Van Dyke said that it will certainly become common in the United States. "Given that this is a space in which there is really no meaningful activity yet, [the fact that there are already] seven vendors we found quite surprising," he said. "We think this is one of the areas that companies should be placing bets on, because when it does take off in a few years, we expect this will be universal technology not unlike ATM. It just makes sense."